The American Property Casualty Insurance Association (APCIA) expressed concerns about a potential override by the Rhode Island General Assembly of Rhode Island Gov. Daniel McKee’s veto of a bill relating to auto insurance.
The bill – the Unfair Claims Settlement Practices Act (Senate Bill 870/House Bill 6324) – outlines what constitutes unfair claims practices by insurers. The bill includes several provisions, including misrepresenting to claimants and insured relevant facts or policy provisions relating to coverage at issue; failing to acknowledge and act with reasonable promptness upon pertinent communications with respect to claims arising under its policies; and failing to adopt and implement reasonable standards for the prompt investigation and settlement of claims arising under its policies, to name just a few of the 25 plus provisions.
APCIA said an override of McKee’s veto by the General Assembly could lead to higher auto body repair costs and auto insurance premiums. The Assembly may consider it when it reconvenes on Jan. 22, 2022. The group took particular exception to language that calls for a standard auto industry markup on auto body repairs.
“In July, Governor McKee stood up for Rhode Island consumers by vetoing S-870/H-6324, special interest legislation that would benefit a small number of auto body industry insiders at the expense of Rhode Island drivers who already pay the highest auto body repair costs in the nation,” Frank O’Brien, vice president of state government affairs for APCIA, said. “This legislation would allow the auto body industry to charge a totally undefined, uncapped ‘industry standard markup’ on repairs. With an average repair cost of $4,500, even a 10% ‘industry standard markup’ could end up costing Rhode Island drivers an additional $450, and with no definitions or limits, these costs could well be significantly higher.”
APCIA also sent a letter to House Speaker K. Joseph Shekarchi and Senate President Dominick Ruggerio urging the House and Senate to not take up a veto override vote.
“With Rhode Islanders still struggling through the pandemic and facing rising costs for gas, groceries, and other essentials, overriding the governor’s veto would send a terrible message that the General Assembly cares more about a few auto body industry insiders than drivers who just want their cars repaired at a reasonable, fair cost,” O’Brien said.